Small lump sum to save - ADVICE NEEDED PLEASE

daveskey69

I've got £3000 that I'd like to put away and make me a little money in the process. I know its not that big of a chunk, but I was wondering what my best bets would be...

I've read a bit about ISAs, but I have zero economic prowess, so am finding the jargon a bit confusing. My understanding is that you agree to put your money away for a specified amount of time and you earn tax free interest on it. But there are different types of ISA, no? Colour me confused.

And is an ISA my best option? I'd really appreciate some advice! Thanks!

DAVE

jimjames

Depends if it is money you are likely to need over the next 5 years or so. If it is then a savings account is the only real viable option. The best rate you can currently get is 5% with Nationwide or TSB but these are not in the ISA wrapper.

If you are prepared for the value of your money to vary then a S&S ISA is an option. There are various threads on here that give info about that as an option but it should be for money that you don't need short term.

xylophone

Do you have the most advantageous current account? For example, would the Santander 123 account suit you? This would also give you access to their linked ISA. http://www.moneysavingexpert.com/banking/compare-best-bank-accounts

http://www.thisismoney.co.uk/money/saving/article-1723571/This-Moneys-favourite-best-buy-Isas.html might be worth a look.

oldtoolie

Read the ISA guide on this website, it should answer your questions.

https://www.moneysavingexpert.com/savings/best-cash-isa

daveskey69

would you recommend any other options?..Like investments?

innovate

oldtoolie wrote: »

Read the ISA guide on this website, it should answer your questions.

https://www.moneysavingexpert.com/savings/best-cash-isa

This is about cash ISAs (savings) only, not investments (S&S ISAs). ISAs (either flavour of them) are not necessarily the best option for the OP - we have no idea what their circumstances are, so suggesting cash ISAs, or a current account, is a bit premature.

OP, what is you tax band? How old are you? Have you got any debts, mortgage? Have you got financial dependants? Have you got sufficient cash for 6-12 months living expenses in an emergency fund? When do you expect to need your £3K? What is your attitude to risk e.g. how would you react if your £3K was only worth £2.5K in 4 years time?

jimjames

daveskey69 wrote: »

would you recommend any other options?..Like investments?

I mentioned S&S ISA but you need to consider if that is appropriate.

Lots of threads here to read. You can also look at http://monevator.com/

daveskey69

have decided to go with a stocks and shares ISA from Virgin. Long term returns on average seem very promising.

Archi_Bald

The Virgin ISA is one of the worst performing S&S ISAs in the market. Has been so, since the turn of the millenium.

If you are a Which? subscriber, check out their latest magazine. It makes terrible reading for Virgin &S&S ISA owners.

daveskey69

wow..i have not done it yet, so thank you for letting me know that. Anyone know a good place to see which are the best performing S&S isa?

Archi_Bald

You need to pick a fund or two that you think will do ok and invest in that with a very low cost provider.

Ideas for funds: http://monevator.com/category/investing/passive-investing-investing/

Ideas for providers: http://monevator.com/compare-uk-cheapest-online-brokers/